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Can you claim 401k withdrawals as income on your tax return and if yes, which is the form do you use to file that income?

 
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Can you claim 401k withdrawals as income on your tax return and if yes, which is the form do you use to file that income?

If you take a distribution from your 401k you will receive a 1099R in late January.  You will enter that 1099R into the Wages & Income section of TurboTax--that distribution is taxable income to you.  In addition, if it is an early distribution, you will owe a 10% early withdrawal penalty.  TurboTax will calculate thatbased the date of birth you enter in Personal Info.  

Go to  Federal> Wages and Income>Retirement Plans and Social Security>IRA  401 k) Pension Plan Withdrawals to enter your 1099R.

**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**

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6 Replies

Can you claim 401k withdrawals as income on your tax return and if yes, which is the form do you use to file that income?

Maybe I'm reading too much in to this, but it is interesting that you asked "can" you claim the 401k as income, indicating you may WANT to have income.   Just so you know, the 401k withdrawal will not enable you for the Earned Income Credit or Additional Child Tax Credit.

Can you claim 401k withdrawals as income on your tax return and if yes, which is the form do you use to file that income?

In fact, you MUST claim these withdrawals.

Can you claim 401k withdrawals as income on your tax return and if yes, which is the form do you use to file that income?

If you take a distribution from your 401k you will receive a 1099R in late January.  You will enter that 1099R into the Wages & Income section of TurboTax--that distribution is taxable income to you.  In addition, if it is an early distribution, you will owe a 10% early withdrawal penalty.  TurboTax will calculate thatbased the date of birth you enter in Personal Info.  

Go to  Federal> Wages and Income>Retirement Plans and Social Security>IRA  401 k) Pension Plan Withdrawals to enter your 1099R.

**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**
jimr62
New Member

Can you claim 401k withdrawals as income on your tax return and if yes, which is the form do you use to file that income?

If you are totally disabled and UNDER 59 and do an early withdraw as I've done ,you do not pay the 10 percent early withdraw penalty. This needs to be part of the information for those in my shoes. Sometimes unforeseen issues arise and this should be shared.  Of course you still have to file form 1040 to report it in addition to the 5329 form I assume.

Chadm1982
New Member

Can you claim 401k withdrawals as income on your tax return and if yes, which is the form do you use to file that income?

I claimed it in income section that I withdrew and it says I will have to pay $743 but when I finish my taxes it says I only owe $162. What went wrong?

CatinaT1
Employee Tax Expert

Can you claim 401k withdrawals as income on your tax return and if yes, which is the form do you use to file that income?

Your 401k withdraw is reported to you on a 1099R.  You might have had federal and state tax withheld as part of the distribution.  In addition to income tax, if you are under 59 1/2, you will be charged a 10% early withdraw penalty on the disbursement.

 

Assuming you have more income than just the 401k withdraw, the refunds monitor will not be accurate until you have entered all sources of income, all credits and deductions have been entered and calculated, and all withholding amounts have been entered.

 

It is possible just based on the 401k withdraw that $743 is your tax on just that piece of income, but when other income and credits are applied it reduces your balance due to $162.

 

More details would be needed to provide you a more specific answer.

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